📝 Japan Withholding Tax Calculator

Calculate withholding tax on compensation for freelance and side work. Automatic calculation including income tax and special reconstruction tax.

📅 2025 withholding tax rates: 10.21% up to ¥1M, 20.42% over ¥1M (income tax + special reconstruction tax 2.1%)

Calculation Results

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Withholding Tax — Net Payment —

Tax Breakdown

Up to ¥1,000,000 · Rate 10.21% — Over ¥1,000,000 · Rate 20.42% — Total Withholding Tax —

INFO

About Withholding Tax

What is Withholding Tax: A system where the payer deducts income tax and special reconstruction tax when paying compensation and remits it to the government.

Applicable Compensation:
• Manuscript fees, lecture fees, design fees
• Programming, web design
• Consulting fees
• Translation, interpretation fees
• Other professional service compensation

Tax Rates (2025):
• Up to ¥1,000,000: 10.21% (10% income tax + 0.21% special reconstruction tax)
• Over ¥1,000,000: 20.42% (20% income tax + 0.42% special reconstruction tax)

Special Reconstruction Tax: As reconstruction funds for the Great East Japan Earthquake, 2.1% of income tax is levied from January 2013 to December 2037.

Note: Consumption tax is not subject to withholding. If compensation includes consumption tax, the amount excluding it is subject to withholding.

GUÍA

2025 Japan Withholding Tax Guide

Basics of the withholding system

Withholding is a system where the payer of salary or compensation (the withholding agent) deducts income tax and special reconstruction tax at the time of payment and remits it to the government on the recipient's behalf. As of 2025, not only employee salaries but also compensation and fees paid to freelancers and sole proprietors are subject to withholding.

2025 rates and calculation

For a single payment to the same person, the portion up to ¥1,000,000 is taxed at 10.21% (10% income tax + 0.21% special reconstruction tax), and the portion over ¥1,000,000 at 20.42% (20% + 0.42%). Example: withholding on ¥1,500,000 = ¥1,000,000 × 10.21% + ¥500,000 × 20.42% = ¥204,200.

Treatment of consumption tax

Only the compensation itself is subject to withholding; consumption tax is excluded. If compensation includes consumption tax, the amount excluding consumption tax is the withholding base. Always itemize compensation, consumption tax, and withholding tax on invoices.

Settlement at tax return

Withheld tax is a prepayment; the final amount is computed in the annual tax return, settling any over- or under-payment. With substantial expenses or deductions, a refund is common.

Preguntas frecuentes

When do the 10.21% and 20.42% rates apply?

For a single payment to the same person, the portion up to ¥1,000,000 is taxed at 10.21%, and the portion over ¥1,000,000 at 20.42%. For ¥1,500,000, that's ¥1,000,000 × 10.21% + ¥500,000 × 20.42% = ¥204,200.

Is consumption tax included in the withholding calculation?

No. Withholding tax is calculated only on the compensation amount excluding consumption tax. On a tax-included ¥550,000 (10% consumption tax), the tax-excluded base is ¥500,000, so withholding is ¥51,050.

Can I still file my tax return if I never receive a payment record (shiharai chosho)?

Yes. Companies aren't obligated to issue this document to the recipient, so it's common not to receive one. As long as you keep your own invoices and records of income and withholding, you can file normally.

Why do freelancers often get a refund?

Withholding is applied at a flat 10.21% or 20.42%, but actual income tax rates start at 5% and rise progressively with taxable income. After deducting expenses and allowances, the actual tax owed is often lower than what was withheld, resulting in a refund.

Is there ever no withholding obligation for a sole proprietor client?

Yes. A sole proprietor with no employees (working alone or only with family helpers) is not required to withhold tax when paying compensation, so the full amount is paid and the recipient reports and pays tax via their own tax return.